Well crap, I gave away the result again in the post title. Oh well, sometimes life is less about the answer and more about the journey to get there. Holy cow Mr. Widget how did you manage to raise your pay so much in one year?! This is no trick, I did in fact increase my salary more than 26% in one year without switching companies or groups. Here is how I did it.
Those of you that read last weeks post know that this is the second and final part of a series I like to call Get Paid. A series on how I turned down a job offering a large pay raise and how I increased my compensation at my current company.
Part 1 Summary
First just a quick recap of where I left off last week. I had just turned down a job offer at a great company for 18% more in base pay, along with a better 401k match and healthcare benefits.
I ended up turning this position down due to recently getting a valuable work assignment and having a good boss. Also, although the offer was for more pay, it was still below the market value for someone with my experience and education.
It was not (entirely) about the money. Everyone wants to feel like a valued employee and I was no different. The offer I received from my previous post was definitely a generous one compared to what I was making at the time.
I already felt under compensated at my current company (35-45%), the last thing I wanted to do was go somewhere new and feel the same way. Changing jobs already has enough challenges without feeling like you are compensated unfairly.
I am all for getting my foot in the door and proving myself, but I have also been around long enough to know that this does not guarantee a company will take care of you. It is also hard to make a case for deserving a good raise or promotion after only working somewhere for a year.
So how on earth did I manage to fall so behind my peers? There is plenty of blame to go around on this one but most are probably my fault. The main factors in why I was so far behind were:
I Have Never Changed Companies
Moving around to different companies is an effective way of increasing pay, especially early on in your career. I have witnessed this, and obviously experienced it as well with the offer I could have accepted. So why haven’t I used this technique in my career?
My “problem” was I truly enjoyed the work I was doing and the company I worked for. Sure, there have been down times, but for the most part I have enjoyed the time I have spent at my company. This meant that the main reason I would be leaving would be for the money.
When I was single, I was the only one affected by my compensation. It was only after I met and later married Mrs. Widget that I began to think about how my compensation impacted our family’s future.
Poor Career Management
When I started my career I was naive enough to think that if I did a good job that would be enough to keep my pay at a market rate. Show up, do a good job, and you will be recognized and appreciated. I began to realize doing the first two did not guarantee the third.
By nature I am not one to toot my horn. I try to remain humble because I know there is another mistake somewhere in my future. I am my own worst critic. Unfortunately this approach is a poor one when it comes to getting good raises or promotions.
Being confident without it coming across as cocky is a great skill that is difficult to do well. People that do this well still make mistakes, but they are able to promote their successes in an effective way.
Changing Groups with Lateral Moves
In working at the same company long-term I have made a total of three moves into different groups. The first I received a promotion for, but the last two were within eight months of each other and were lateral moves. These last two moves were under less than ideal situations that are worthy of a future post.
Bottom line, I was not getting promoted on the way out of someone’s group and I was not filling higher positions entering either.
So those are the main reasons I was so far behind in compensation, but how was I able to increase it by so much in a single year?
I mentioned in last weeks post that I was expecting a promotion a couple of months after I received the offer. I had brought up my pay discrepancy with my boss about four months before my interview with the other company. He agreed that I was well behind and agreed to a promotion at the start of the next review cycle.
Now I did not just walk into his office and demand to be paid more. I had performed market research by plugging my experience, education, and geographic location into several of the online salary websites. By doing so I was able to visually show him the discrepancy in a presentation I created.
Companies are not going to pay you more based off tenure alone. Showing the value you create for the group/company is paramount in asking for a raise.
Two months after I turned down the job offer I went into my bosses office for my annual review. After our discussion a few months earlier I was fairly confident he would confirm my promotion! That is not what happened. He informed me that I would not be receiving a promotion at that time.
Aw man, but I just turned down a great job offer! It was not all doom and gloom, he stated that he wanted to get me an off cycle promotion. These are promotions that occur at a time other than the yearly review cycle. I had heard of a couple of people getting these but they are rare.
One thing I did know about off cycle promotions was they could come with a higher percentage raise than those given at the typical time. The budgets for the standard review cycle get spread out to all the manager’s employees, so to give one person a bigger bump meant giving less to another.
This was promising, so I decided to continue doing good work and see how it would play out. I ended up with a raise of around 3% after the review.
Over the next six months I periodically asked my boss the status of the promotion. To his credit he was good with keeping me up to date on where we stood in the process.
One day close to the six month mark I asked him if there was an update and he asked if he could meet with me. Uh oh, what now? He met me in my office and told me the promotion was approved! Great news, but how much of a raise did it come with? Turns out I ended up with a 15% raise!
This was probably 5% higher than a typical promotion raise given on the yearly review cycle. So about eight months after turning down the job offer, I had increased my pay a little more than 20%. Not too bad and I still had another raise coming in six more months.
The company realized I was still below where I should be so I ended up getting a 5% raise at the next review cycle. So in 366 days my pay increased a little more than 26% from where I started. Not bad for a single year (and a day).
My base salary is still lower than my market rate, but I continue to enjoy the work I am doing and the path to another promotion in the future. I can guarantee you I will not be waiting around for that to happen though. Pushing for the competencies and tasks needed for the next promotion is in the works already.
One thing I did not try was bringing in a competing offer. The offer I received was contingent, so it would have been a large gamble to use that to get a raise with my current company. I could have waited until the offer was firm, but once I made the decision I was not going to take the job I did not see the point. I have always felt if you receive another offer you like, you should take it.
Nothing against people who have used this technique to get an instant raise. Everyone needs to do what is right for them and their family. In fact I have read that some professions expect you to bring in a competing offer to receive a decent raise.
I was aware of others that were doing this while I was going through the process. Some stayed, and some left anyway.
This process was definitely a learning experience. If there was one main lesson I learned, it is how important being proactive in managing your career is. You have to be your own advocate throughout your career to get what you want out of it.
I would also advise young engineers to identify a mentor who is in a position they want to be in. A good mentor can provide sound career advice to help guide your career path.
Oh I forgot to mention, a year after I turned down the job offer the same company contacted me about an opening they had. I was worried I burned a bridge, but that was not the case! I was not interested in the position they had open but it would have been interesting to see what they would have offered this time around.
Readers: What techniques have you used to increase your pay without switching companies? Have you found yourself stagnating at times in your career? Any advice for how to be a better advocate for yourself?